We never had the luxury of a referendum, which we are sure would have led to a massive rejection. The people of Iceland must be well aware of the way the costs of banking crisis were imposed on us. Little did people realise that the state guarantee to protect the first £50,000 in our accounts would come at such a cost.

Now due to the UK and Dutch government protecting the money we saved in the collapsed Icelandic banks, plus the money our pension funds saved in them too, the Icelandic government is heading for court as a result of the No vote.

"I know this will probably hurt us internationally, but it is worth taking a stance," Thorgerdun Asgeirsdottir, a 28-year-old barista said after casting a "no" vote.

Svanhvit Ingibergs, 33, who works at a rest home, said: "I had no part in causing those debts, and I don't want our children to risk having to pay them. It would be better to settle this in a court."

State television said almost 60 percent of voters had rejected the agreement, based on results from five out of six voting districts, including capital Reykjavik. Many voters were against taxpayers footing the bill for irresponsible bankers. Just over 169,000 votes had been counted out of the 230,000 eligible voters.

The prime minister, who had predicted a no vote would cause economic uncertainty for at least a year or two, did not say whether the government planned to resign.

"We must do all we can to prevent political and economic chaos as a result of this outcome," she said.

Iceland could of course chase the real culprits the bankers who caused the chaos and those responsible in the international community who imposed the crazy banking and finance system on the country in the first place. The people are right they are not their debts they are the bankers debts!